Effects on the Host in Offshore Outsourcing

In this 8-minute video on Offshore Outsourcing as viewed by an academic, Professor Bhattacharya said one thing that struck me. We talk a lot about offshore outsourcing and how it has a positive effect on the companies that do employ this. We have broken down the good points of offshore outsourcing but exactly does it do the host country?

Prof. Bhattacharya wanted to talk about outsourcing in China when it comes to manufacturing but couldn't because of language and culture barriers. However he was able to give a brief overview about the leading host country in IT services, which is none other than India. In my opinion, growth has a possibility of being inhibited if host companies keep depending on outsourcing as a source of work. That's why I think it's good that India is actually developing their own ways and reaching out to other countries for their own brand of offshore outsourcing business functions.

As for hosts like China and the Philippines, we have yet to actually see them reverse their situation and develop their own methods to export to other countries but perhaps in time we will see call centers set up by the Philippines in areas other than their homeland and consequently giving jobs to other host countries.

Offshore Call Centers: Accents make or break the deal

We already know that offshore outsourcing call centers save a great deal of cost for a company. That’s why everyone’s jumping in the bandwagon in the first place. But let’s look more closely at how offshore call centers operate.

It is inescapable to note the weakness of having a call center offshore and that is none other than accent. The thing about customer service is that the person calling for help should be able to trust the one helping him. Generally, irate customers don’t listen to proper reason anymore and would curse at the nearest ear they could find. Now, if the person they’re calling has a strong accent and horrible English, chances are they’d get even more annoyed. The annoyance won’t be so much focused on the problem anymore but would actually fall on the fact that they are being redirected to people who they think doesn’t understand because of their accent and grammar. In truth, a lot of Americans right now even ask the one who answered their call if they really are Americans because they wouldn’t talk to them if they weren’t. Profit goes down, and the number of potential customers will decrease if by word-of-mouth or by some other means, it would spread that your company has bad customer service.

Same goes for call centers that make outbound calls. Aside from the fact that these people are disturbed from their homes by complete strangers, it is also doubly irritating if the person who disturbed them had an accent they could not get. Chances of selling dwindle down to near zero.

It is no secret either that aside from the standard American accent, Asian or Middle-eastern accent on the English language is a bit frowned upon, if not laughed at. That’s why it’s important for offshore call centers to train their agents to speak like Americans. IBM once devised a way to fix the accent problem through a web-based technology that helps improve language skills.

While accents are imperative to actually bagging that customer and making sure they won’t hang up on you, it is also equally important for an agent to listen to the customer. I think the whole call center system is wrong in placing highest priority in finishing a call in the shortest time possible. That makes some agents neglect their responsibilities and forget that their purpose is for the convenience of the customers.

Offshoring, Outsourcing: 3 reasons why it's good for you

It's every businessman's goal to maximize profit using minimal cost. The first question starting entrepreneurs ask is "What do I get out of this?" In the ancient art of alchemy it has been said that in order to gain something you must offer something of equal value. However, when it comes to offshoring and outsourcing, you actually manage to get a whole lot while giving so little. Companies save millions of production cost by offshoring and outsourcing. This is particularly evident with the prominence of call centers in various countries like the Philippines, India, Australia and China.

Price goes down = Demand goes up

It's basic knowledge that the relationship between price and demand is almost completely inversely proportional. If all other things are taken to be in equal value then we can safely assume that as price decreases, the quantity demanded increases. Now where does offshoring and outsourcing come in? Let us remember the relationship between cost of production and price of commodity. If it takes less money for you to produce then it is possible to lower the price. If you outsource certain business functions, you cut down cost. You do the math from here.

Odd Jobs out, Great Jobs in

Along with the progress offshoring and outsourcing give, it won't exactly be a business venture without worry and risk now would it? What people worry about is that employees of these client companies will lose their jobs to relatively cheaper alternatives to labor cost. That is one way of looking at it. That's the easy way of looking at it. However, if you'd also look at another side of it, if a company moves call center jobs offshore, the way would be paved for more sophisticated jobs; jobs that require greater skill and qualifications. This in turn moves the education system and trains people to be more competent to qualify for higher-paying, more fulfilling jobs.

Business will focus on what really matters

Most of the jobs being outsourced by client companies are customer service jobs or tech support jobs. These business functions though still needed is at the bottom of the food chain and once you offshore this business function, you will have time to focus more on the things that do matter. Invest more time, money and effort on research or marketing.

In offshoring and outsourcing, good things keep coming. Outsourcing jobs to foreign countries may be one of the best ideas to come out. Call centers top the list. Inbound or outbound, these are jobs that developing countries strive for and the developed countries can easily dispense. It’s a win-win situation for both parties.